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3 things to know about taxes in Australia
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Are you leaving your home country to settle in Sydney or are you going on an adventure in the Australian bush? Medium or long term expatriation, working holiday visas: any work in Australia is taxable. Here are 3 essential points to understand the Australian tax system.

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"Pay as you earn" tax in Australia: what you pay

When you work, tax in Australia is deducted directly at source under the following schemes:

  • income tax, the rate of which varies depending on your tax status and income
  • the 2% Medicare levy;
  • the Superannuation contribution of 9.5%.

Do you earn less than AUD 450 per month? Then you are exempt from the superannuation levy.

Of course, if you have paid more tax than you should have, the Australian taxation Office (ATO) will pay you the difference after each adjustment. This is known as a tax refund. If not, you will have to pay the missing amount (tax debt). 

 > If you have automatically paid into Medicare when you were not eligible, you will receive a refund for the difference. You will also receive a refund for the overpayment.

>> Read also: A guide to settling in Sydney

A tax scale that varies according to your tax residence

To be or not to be a tax resident, that is the question!

Have you lived in Australia for more than 6 consecutive months? Then you are considered a resident. You will be taxed at the following rates: 

  • from 18,201 to 37,000 AUD: 19
  • from 37 001 to 80 000 AUD: 32,5
  • 80,001 to 180,001: 37%.
  • 180,001+: 45%.

Therefore, if you are a resident and earned less than AUD 18,200 in the year, you benefit from the tax-free threshold. In other words, you are not taxable.

This is a privilege that non-residents do not enjoy, however. If you have worked in Australia for less than 6 months, a common rate of 32.5% applies to your income, regardless of whether you earned a total of 18,200, 37,000 or 80,000 AUD. Beyond that, the same rates apply as for residents.

Leaving Australia? What you can take back before you leave

When you are on a temporary visa, such as a WHP, it is possible to reclaim part of your pension contributions directly from your salary. 

Why only "part"? Because a 30% tax will be applied to the funds paid back. You will need to apply for a "Departing Australia Superannuation Payment" (DASP)

This is obviously only possible if you are leaving Australia permanently.

> Note: even if you leave Australia before the end of the tax year (1 July to 30 June of the following year), you still have to file your return. It can be done online from overseas until 31 October

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